KARACHI: Pakistan’s import cover has been reduced to two months with a reduction in official foreign exchange reserves of the State Bank of Pakistan (SBP) to $16.01 billion.

The import cover was 3.3 months in August 2021, according to analysts at Topline Securities.

According to the data released by the SBP, its official reserves were declined by $244 million to $16.01 billion by the week ended November 26, 2021, as compared with $16.254 billion a week ago.

The foreign exchange reserves of the country reduced by $275 million to $22.499 billion by the week ended November 26, 2021, as compared with $22.774 billion by the week ended November 19, 2021.

The foreign exchange reserves held by commercial banks also declined by $31 million to $6.489 billion by the week ended November 26, 2021 as compared with $6.52 billion a week ago.

A decline in foreign exchange reserves can increase pressure on the country’s external account and currency stability, particularly when import financing requirements remain elevated. Economists closely monitor reserve levels as they reflect a nation’s ability to meet external payment obligations and manage exchange rate volatility. Sustained improvement in reserves generally depends on stronger exports, higher remittances, and stable foreign investment inflows, alongside prudent fiscal and monetary policy measures.